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Federal court imposes $3 million fine on ship management company

A federal judge in Maryland has sentenced a ship management company to pay a $3 million criminal fine and $1 million in organizational community service payments that will fund various marine environmental projects for violations of the Act to Prevent Pollution from Ships (Act). The court also ordered that four crew members who notified authorities about illegal discharges of oil and plastic from the M/V Iorana, a Greek flagged cargo ship, be awarded $125,000 each under the Act, which provides that whistleblowers may receive an award of up to one-half of fines collected under the statute.

The company pleaded guilty on July 8, 2010, as part of a multi-district plea agreement arising out of charges brought in the District of Maryland, the Western District of Washington and the Eastern District of Louisiana, related to port calls in Baltimore, Tacoma and New Orleans, and obstruction of justice based on false statements to the Coast Guard. Court records indicate that the ship’s chief engineer repeatedly directed that waste oil be dumped overboard through a bypass hose that circumvented pollution prevention equipment required by law. The shipping company admitted that the ship also dumped plastic bags filled with oily rags overboard and made false statements to the Coast Guard. See DOJ Press Release, September 21, 2010.

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